Gold loan non-banking financial company (NBFC) Muthoot Finance is planning to enter the white label ATMs (WLAs) space to consolidate its presence in financial services. It has applied to the Reserve Bank of India for this.
White label ATMs are the ones owned and operated by non-banking entities. According to the current policy, only banks can establish and operate the ATMs.
Earlier this year, the central bank had decided to allow non-banks, whose net worth is at least Rs 100 crore, to set up and operate ATMs to increase the per capita availability and also increase their penetration in tier-III to tier-VI towns and villages.
In June, RBI had issued the detailed guidelines for WLAs.
RBI had proposed three schemes for companies which wished to apply for WLAs. In the first (Scheme A), a company has to set up at least 1,000 WLAs in the first year. In the second year, it should at least double the number of WLAs it set up in the first year. In the third year, the company is required to set up at least three times the WLAs it installed in the second year.
For every three WLAs installed in tier III-VI centres, a company can install one WLA in a tier-I or tier-II centre.
Muthoot has applied for the WLA licence under Scheme A.
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